There’s been speculation that when the Trump administration picks Watt’s successor, one of the first things that person might do is impose a loan-size purchase limit on the two government-sponsored enterprises.
Sen. Mike Crapo, R-ID, chair of the Senate Committee on Banking, Housing and Urban Affairs, isn’t giving up on housing-finance reform in 2018, even though many industry observers already have. He said it’s still a “high priority,” while speaking at the Mortgage Bankers Association’s National Advocacy conference in Washington this week. Crapo disagreed with comments made earlier in the day by Housing and Urban Development Deputy Secretary Pam Patenaude, who said there aren’t enough legislative days left to do GSE reform this go around. And he was adamant in saying he’s not ruling out the possibility of reform happening in this Congress.
Freddie Mac introduced a new conventional 3 percent downpayment program that is open to a wider range of borrowers with no income restrictions or limitations as to where the borrower lives. The new mortgage product, HomeOne, was created to allow lenders flexibility when it comes to helping borrowers anywhere in the country become homeowners and overcome the common hurdle of a lack of downpayment resources, said Danny Gardner, Freddie’s senior vice president of single-family affordable lending and access to credit. He said HomeOne is great for potential borrowers looking to...
Pershing Square Holdings, one of the largest institutional investors in Fannie Mae and Freddie Mac common stock, is doubling down on its investment in the two mortgage giants. But it’s taking a different tack, buying up junior preferred stock rather than increasing its holdings of common. The change in strategy was mentioned in the firm’s annual report to shareholders and comes at a time when the chances of housing-finance reform look nil for 2018. How much PSH paid for the junior preferred is unknown. According to the annual report, “Our preferred stock represents approximately 21 percent of our total investment in Fannie and Freddie, or about 1 percent of net assets.”
Automated appraisals may be less biased and give more accurate property value estimates, according to a new working paper by the Federal Housing Finance Agency’s Office of Policy Analysis and Research. This is especially true in rural areas where there are fewer comparable stats and more heterogeneity across homes, said the authors, Alexander Bogin and Jessica Shui. In fact, the data suggest that more than 25 percent of rural appraisals exceed the associated contract price by more than 5 percent. The study was based on GSE loan acquisitions from 2012 to 2016.Moreover, given the bias found in appraisals, some researchers have considered including automated...
Federal Housing Finance Agency Director Mel Watt said he has noticed an uptick in the number of minority-owned firms active in Fannie Mae and Freddie Mac transactions. Watt, speaking at the National Association of Minority Mortgage Bankers of America conference in Atlanta earlier this month, discussed the importance of diversity and inclusion in the real estate industry. He noted that although a lot of work still needs to be done, the results so far have been encouraging. “Perhaps most exciting are the results we are seeing at the financial transaction level where minority-owned firms are now involved in...
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